Ethereum is Locked Up requires Jail Break Run
The super cryptocurrency witnessed a strong bearish breakdown over the weekend, falling to a low of $1,811 on Sunday, its lowest level in three weeks. ETH has declined more than 57% since its top in 2024.
The digital asset fell below the Exponential Moving Averages of 50 and 200 weeks. A death cross, a highly bearish pattern, will occur when these two averages cross.
Ethereum
At $1,950, the price of ETH has also fallen below the 61.8% Fibonacci Retracement, sometimes referred to as the golden ratio. Both the MACD and the Relative Strength Index (RSI) have been pointing lower. A bearish flag chart pattern, which is a common continuation sign, has also been generated by the coin.
The decline of the altcoin is ascribed to persistent macroeconomic variables as well as issues inside its ecosystem. In particular, ongoing withdrawals from spot Ethereum is locked up ETFs are putting a lot of selling pressure on the altcoin.
With the exception of March 2 and 28, ETH ETFs have had net outflows every day this month, according to data from SoSoValue. With a combined net inflow of just $2.4 billion, these funds’ total net assets now stand at $6 billion.
Because Wall Street investors have not shown enough interest in Ethereum ETFs, they have generally underperformed. Since ETH offers an attractive staking yield of roughly 3%, many of these investors prefer to hold and stake it.
The growing rivalry from the layer-1 and layer-2 sectors has caused the price of ETH to decline. Layer-2 networks like Base and Arbitrum, which are known for their faster transaction speeds and cheaper prices, are the main source of this competition.
More competition for Ethereum comes from layer-1 networks like BNB Chain, Solana, and Sui. These factors support analysts’ concerns that the price of ETH may continue to drop. Standard Chartered analysts, for example, have lowered their goal by 60% to $4,000.
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